How to use this calculator
Turnover is the metric every executive asks about and few companies measure the same way twice. Calculating it consistently, with voluntary and involuntary departures split out, turns a vague worry about people leaving into a number you can track by team and act on.
Enter headcount at the start and end of the period, the number of people who left, and how many left by choice. The calculator uses average headcount, the most common method, and annualizes monthly or quarterly results. Our employee retention strategies guide covers what to do about the number once you have it.
- Choose a period and count employees on payroll on the first and last day.
- Count every employee who left during the period, including terminations and layoffs.
- Count how many of those left voluntarily.
- Enter the length of the period in months to see an annualized rate.
How it's calculated
Average headcount = (starting headcount + ending headcount) / 2
Turnover rate = separations / average headcount x 100
Annualized rate = period rate x 12 / months in the period
Voluntary turnover counts resignations and retirements. Involuntary turnover counts terminations and layoffs. Many companies leave out interns and planned seasonal endings, but whatever you exclude, exclude it every time.
Worked example
A 190-person software company started the year with 180 employees and ended with 196. Twenty-seven people left: 19 resigned and 8 were let go. Average headcount was 188, so annual turnover was 14.4 percent, with 10.1 percent voluntary.
In the first quarter alone, 9 people left. That's 4.8 percent for the quarter, or 19.1 percent annualized, which is why the leadership team started stay interviews in April. Our stay interview invitation is the email they used.
Rules to know
Turnover benchmarks vary enormously by industry. Hospitality, retail, and other hourly-heavy industries run far higher than professional services, according to the Bureau of Labor Statistics JOLTS data on separations. Compare your rate with your own history and with your industry, not with a single national average. Track first-year turnover separately, since early departures often point to hiring or onboarding problems.
This is general information for US employers, not legal or tax advice. Rates and rules change and vary by state and city, so confirm current figures with the agency or a qualified advisor.
Common mistakes
- Dividing by ending headcount, which understates turnover in a growing company.
- Mixing voluntary and involuntary departures into one number.
- Comparing a monthly rate with an annual benchmark.
- Changing what you exclude from one report to the next.
Email templates that go with this
Once you have the number, these templates help you explain it to employees, candidates, or managers.
Where to go from here
A calculator answers one question. The right process and software keep the numbers right every pay period.
Frequently asked questions
What is a good employee turnover rate?
How do you calculate monthly turnover?
Do layoffs count in turnover?
What's the difference between turnover and attrition?
Written by the HRTally Research Team
Our guides are written and reviewed by people with hands-on US HR, payroll, and HR technology experience. Legal and tax facts are checked against primary sources, such as the Department of Labor, IRS, EEOC, and USCIS, and linked at the end of each guide. Vendors never review or pay for our editorial content.